Troubled Linktone clutches at ad deal

Troubled Chinese mobile services firm Linktone has signed a deal that will net it a share of advertising business worth more than $13m this year.

The company, one of several to be hit by changes in China's market for mobile phone information and entertainment services, was recently bolstered by an injection of capital from an Indonesian firm.

Tianjin Satellite Television, which claims more than 170 million viewers in China, has made Linktone its "exclusive long-term partner" for almost all 'Category 1' advertising.

Linktone has been battling to rein in debts, and recently allowed Indonesia's Media Nusantara Citra to take a 51 per cent stake.

The company signed the deal after managing to reduce its debt from $3.2m in the second quarter to $2.8m in the third quarter.

Media Nusantara Citra invests in and controls various media companies in Indonesia, including TV and radio stations.

"Like all wireless providers in China we continue to face volatile regulatory changes and a near-term weakening market environment for wireless value-added services in China. But we do expect the market to stabilise next year," said Linktone chief executive Michael Li.

Linktone's infusion of cash will enable "aggressive execution and implementation of our cross-media strategy in China", Li predicted last week, before the company revealed the new advertising partnership.

"Together we should have an opportunity to pursue advertising and the value-added services cross-selling initiatives in China and other Asian countries," he said.